Kahn Swick & Foti launched an investigation into Lockheed Martin over alleged inadequate oversight of its classified defense contracts. The probe follows three successive disclosures beginning in early 2024 that raised questions about the company's bidding practices. The announcement came the same day the Pentagon awarded Lockheed $879 million in new contracts.
Former Louisiana Attorney General Charles C. Foti Jr.'s firm Kahn Swick & Fotti launched an investigation into Lockheed Martin over alleged inadequate oversight of its classified defense contracts and bidding practices.
"Beginning in early 2024, the Company publicly represented that it had disciplined bidding practices and adequate oversight of its classified defense contracts," the firm said in a statement. "However, in three successive disclosures" the company revealed issues that form the basis of the probe, according to the announcement.
The investigation was disclosed the same day the Pentagon awarded Lockheed $879 million across two contracts. One contract worth $207 million from the Navy, $199 million from the Air Force and about $472.8 million from foreign partners covers aircraft armament equipment including missile launchers, bomb racks and gun systems for F-35 fighter jets. A separate $17 million contract supplies spare parts to an unnamed foreign partner through May 2027. Work on the larger contract is expected to be completed by February 2030.
The probe adds legal and reputational risk for the defense contractor at a time when it is securing major government awards. Lockheed's stock, which counts among holdings disclosed by President Donald Trump's portfolio in a recent federal ethics filing alongside peers General Dynamics and Northrop Grumman, could face pressure as investors assess potential regulatory penalties or disruptions to its classified contract portfolio. The company's next catalyst will be any formal response to the investigation or further disclosures regarding its contract oversight practices.
This article is for informational purposes only and does not constitute investment advice.
